NOTES UPON GIVING CHARTER CAPITAL IN SINGLE MEMEMBER LIMITED LIABILITY COMPANY?

Giving charter capital in a single-member limited liability company is one of the permitted methods of disposing of charter capital under current regulations. However, this process requires compliance with specific legal procedures to ensure transparency and legality. This article highlights some key issues to consider when the owner of a single-member limited liability company gives the entire charter capital.

Giving charter capital must meet the prescribed conditions

The owner of a single-member limited liability company has the right to give charter capital to one or more organizations or individuals. It should be noted that this transaction must be carried out through a giving agreement, with confirmation from the relevant parties.

For the new owner- whether an organization or an individual receiving the charter capital, must meet all the conditions required for establishing and managing enterprises under current legal regulations. This includes conditions related to legal capacity, civil act capacity, and ensuring they are not prohibited from establishing or managing enterprises in Vietnam.

Giving charter capital in single-member limited liability company results in certain legal consequences arising from the change in the enteprise owner

In accordance with the terms of the charter capital donation agreement, all rights and obligations of the former owner towards the company, including the rights to manage and control the capital, are transferred to the new owner.

Accordingly, the business must carry out the procedures for registering changes to the business registration information (specifically regarding the owner details on the Certificate of Enterprise Registration), along with other legal formalities with the relevant government authorities.

Although there is a change in business ownership, this does not affect the legal status of the entity or invalidate any previous contracts or transactions.

It is necessary to carry out legal procedures to change the owner on the Certificate of Enteprise Registration for a single-member limited liability company

The procedure for registering changes to the enterprise registration information to reflect the new owner must be completed within 10 days from the date of finalizing the charter capital giving.

The steps to carry out this process are as follows:

– Step 1: Prepare the documents for changing the owner, including:

+ Notice of change of company owner;

+ Documents proving the giving of charter capital;

+ Legal documents of the new owner;

+ Amended company charter;

+ Other related documents.

– Step 2: Submiting the documents for changing the owner of the single-member limited liability company to the Business Registration Office where the company is headquartered.

Submission can be performed either directly or online through the National Business Registration Portal.

– Step 3: The Business Registration Office will review the application and resolve it within 03 working days from the date of receiving valid documents.

>> PROCEDURES ON CHARTER CAPITAL INCREASE OF SINGLE-MEMBER LIMITED LIABILITY COMPANY https://linconlaw.vn/procedures-on-charter-capital-increase-of-single-member-limited-liability-company/

>> INSUFFICIENT CONTRIBUTION OF CHARTER CAPITAL IN SINGLE-MEMBER LIMITED LIABILITY COMPANY https://linconlaw.vn/insufficient-contribution-of-charter-capital-in-single-member-limited-liability-company/